President Biden calls for bipartisan unity on protections against growing tech sector

In his latest op-ed, President Biden has called for political unity from lawmakers to reform Section 230 in order to better regulate ever-expanding tech companies.

Video Transcript

DAVE BRIGGS: OK, President Biden calling on Republicans and Democrats in congress to find common ground and unite against big tech. Yahoo Finance Tech Reporter Dan Howley here with more on this. Dan, let me just say, I'm a bit pessimistic that Republicans, less than two years out from presidential election, are going to give the president a win on anything, let alone big tech. But they have begun to turn against big business, so maybe there's an opening.

DAN HOWLEY: Yeah, there's some common ground here. And I think one of the big things to look at is what Biden really laid out-- he had three different areas. The first has to do with privacy. And, in fact, he writes in this op-ed, we need serious federal protections for Americans' privacy.

That means clear limits on how companies can collect, use, and share highly personal data, your internet history, your personal communications, your location, and your health, genetic, and biometric data. He then goes on to say that there needs to be responsibility on the parts of companies for the content that is allowed to be posted by users.

That goes into section 230. That's real red meat for Republicans, as well as Democrats. And then there's the idea of getting competition in the tech sector-- so antitrust.

These are all things that both sides want to get to work on. They just can't agree on why.

SEANA SMITH: Well, yeah, and that's going to be the key issue here going forward. And also, how is big tech looking at this, just in terms of the odds that maybe we will see more regulation-- the fact that GOP and the Democrats, yes, they want change, but they want it in different ways? That seems like a very good sign here, at least for the sector.

DAN HOWLEY: Yeah, for tech, yes. Obviously, towards the end of the year, they wanted to get some kind of antitrust action moving forward. That just completely fell on its face, right? I don't remember hearing anything happening.

So it's not like we're going to get anything coming any time soon. It's probably going to come as individual piecemeal parts of what they originally wanted. So maybe some kind of privacy regulation-- that's been something that both sides have been talking about forever.

DAVE BRIGGS: Section 230 has been talked about by both parties.

DAN HOWLEY: Right. It depends on what they don't like from each side, right? Republicans say they don't like it because it hinders conservative speech. Democrats say they don't like it because it allows hate speech. So it's these two sides.

They both don't like it, but they can't agree on how they want to change it. Now, it's important to point out that Section 230 is the reason why the internet kind of exists as it does right now. So any kind of change at all would dramatically change the internet, at least here in the US, potentially around the world.

DAVE BRIGGS: And investors not buying it. If you want to look at stocks, Alphabet up 3%, Amazon up 5%, Meta is basically flat. So they're basically saying, no, we don't think this is likely.

SEANA SMITH: Dan, what do you think this means, though, for the M&A landscape for tech in the near-term? Because, certainly, we've heard from a number of analysts, a number of market participants here saying that M&A is really going to be what drives some of this growth here in 2023. If President Biden, taking directly from this op-ed, saying that we need to bring more competition back to the tech sector, you would think we're going to see more of a crackdown, then, on M&A.

DAN HOWLEY: Yeah, I mean, at least as far as the bigger tech companies go, right? I mean, I don't think Meta is going to be able to go out there and buy anything at all right now. They tried to get that VR company and they were basically just told, no.

I don't think we're going to see any kind of stop to the companies-- the Alphabets, the Apples, the Microsofts-- Meta will probably still be able to pick up some companies, but it's not going to be anything that would be in a space where they probably feel like it is under threat from the likes of the FTC. There's also just constant action in that sector-- it's not as though it's just those companies purchasing. Other, smaller companies, though, for those smaller companies, that's really just a big payday for them and that's what they're aiming for.

But I don't think that means that we won't see any M&A. It just means that Lina Khan of the FTC, and, obviously, Biden in the White House are going to be keeping an eye on it to see what companies want to do, in particular.

DAVE BRIGGS: And the DOJ's antitrust as well-- looks like they're in step there.